2023 Summer Season Brings Mixed Results for South Jersey Economy
In the aftermath of the COVID-19 Lockdowns, there were concerns about how the Tourism Economy would rebound in Cape May and Atlantic Counties. The 2023 Summer Season marks the second full year of a "back to normal" environment for South Jersey and the latest information gathered gives mixed signals about the state of the Tourism Economy.
Stockton University’s School of Business hosted the fourth annual Jersey Shoreview which featured a discussion panel with regional business leaders. This panel discussion was sponsored by the Lloyd D. Levenson Institute of Gaming, Hospitality, and Tourism (LIGHT). The panel discussion highlighted the biggest negative factors in the 2023 Summer Season were high gas prices, inclement weather, and national economic inflation.
Cape May County Department of Tourism Director Diane Wieland stated that the County generated $5.2 million in occupancy tax just in July of 2023. That is a 17% increase from 2022 and outpaced pre-COVID numbers from 2019. But despite those numbers, inflation still had a negative impact on Cape May County Tourism:
"We are seeing that we were up a little (over last year, but) our businesses are saying (the summer) wasn’t great. They are saying they did OK. And OK is good with us...In the past, we had 39% of our visitors stay seven days or longer (but) now we are seeing that down to 28%. We’ve found that they want to go on vacation. They love the Jersey Shore, however, they don’t have the money so they’ve changed their length of stay.”
Wieland also said that labor shortages impacted Cape May County business, leading to changes in how these businesses functioned, such as restaurants focusing more on takeout or cutting down their hours because of the difficulties paying employees due to the higher minimum wage. Wieland openly questioned whether small businesses would be able to sustain profitability with the impacts on the current economic environment.
Sandy Chu is in charge of the financial and professional services sector for the New Jersey Economic Development Authority (NJEDA) and she responded by saying the NJDEA understands the challenges for Jersey Shore business. She stated that she is working on ways to help these small businesses with tax cuts, grants, and other incentives.
"My goal is to outreach further, deeper and wider, particularly in the Jersey Shore area - The Jersey Shore is a huge area with huge competitive advantages.…If we can realize those potential opportunities that would create a win-win for everybody. - It’s a work in progress, but we are making nice progress.”
On the flipside, Atlantic City saw economic positives during the Summer of 2023 including Total gaming gross revenue up 11% from last year while Casino employment is up up 3% and the Atlantic City Expressway Pleasantville Toll Plaza saw a 3.7% increase. Also, non-gaming revenue now accounts for 45% of Atlantic City Casino Profits, an increase of 6% compared to what those numbers were in 2017.
When I spoke to small business owners in Sea Isle City and Ocean City recently, they said this year was the first time they saw business revenues at pre-COVID Pandemic Levels. While some businesses experienced a post-July 4th holiday weekend dip in gross revenue, there are restaurants that experienced a higher demand for takeout compared to delivery during the 2023 Summer Season. Everyone agrees that inflation and high gas prices have put a squeeze on many people so that caused less of a profitable summer season than they had hoped for.
While some economic issues are out of our control, what we can control is where we spend our money. This information about the 2023 Summer Season in South Jersey is just another reminder that if you care about your community, then we all must support local small businesses. They are the backbone of our area and I would suggest the next time you want to go out to a restaurant or purchase an item, take the time to spend your money with a small business in South Jersey.